Northland Power Income Fund merges with Northland Power Inc.

Date Closed: 7/16/2009

Value: C$322 million

On July 16, 2009, Northland Power Income Fund (TSX: NPI.UN) (the Fund) merged with Northland Power Inc. (NPI) the parent of the external manager of the Fund, through the acquisition of all of the issued and outstanding shares of NPI from Northland Power Holdings Inc. The completion of the acquisition and related transactions was subject to unitholder approval which was received earlier that day.

The purchase price paid by the Fund consisted of securities exchangeable into units of the Fund, a portion of which are contingent upon NPI's development activities resulting in value to the Fund. The transaction was a related party transaction under applicable securities laws and therefore required an independent valuation. Crosbie & Co. was retained as the independent valuator and valued NPI at $322 to $421 million. The Independent Trustees of the Fund unanimously recommended that unitholders approve the merger.

The Fund is a Canadian income trust that indirectly owns equity interests in six power projects, which efficiently and cleanly produce electricity and steam for sale under long-term contracts. NPI is one of Canada 's leading power developers, owners and operators. In addition to acting as manager of the Fund, NPI has completed power generation projects totaling more than 740 MW of capacity and financings totaling over $2 billion.

Northland Power Holdings Inc. and the manager of the Fund were represented by BLG with a team led by Linda Bertoldi and assisted by Paul Findlay, Dolores Di Felice and Gord Raman and Michael Tripp (securities), Tracy Robillard, Anna Naud and Andrew Smith (corporate), Stephen Fyfe and Eva Krasa (tax), Bruce Fowler and Gus Karantzoulis (financing) and Jeff Mitchell (labour and employment) and Eric Dufour (competition).